# kaal:claim:1908473-032

**Claim.** Allocating super-voting stock to contingent capital holders satisfies Delaware's legitimate business purpose requirement, because the allocation serves to avoid insolvency and dissolution of the institution.

**Type.** condition  **Support.** argued

**Holds when.**

- Delaware permits alternative voting arrangements if the charter provides for them or is amended
- Increases are limited if inequitable or in breach of fiduciary duty

**Source quote.**

> Allocating super-voting stock, as proposed herein, would be for the legitimate business purpose of avoiding both insolvency and dissolution.

**From.** Wulf A. Kaal, Christoph Henkel, *Contingent Capital with Sequential Triggers* (2011), IV.B.2.b. U.S. Law, page 43

**Cite as.** Wulf A. Kaal, Christoph Henkel, Contingent Capital with Sequential Triggers (2011). SSRN: https://ssrn.com/abstract=1908473

**Verify.** sha256 of source PDF `9d578dac663357529edd1f6453fcfe69bdc59ac882408d9edfde5a4c2916befa` at https://raw.githubusercontent.com/wulfkaal/Academic-Papers/main/papers/pdf/Kaal%20and%20Henkel%20-%202011%20-%20Contingent%20Capital%20with%20Sequential%20Triggers.pdf

**Topics.** governance-design

**Keywords.** delaware-law, super-voting-stock, legitimate-business-purpose, voting-rights

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